Monday, April 20, 2009

What's the Senate hearing about? The definition of blight and a cost/benefit analysis, among other things

(This is one in an irregular series of articles about issues that a State Senate committee might address when it holds a hearing on Atlantic Yards.)

The Courier-Life's Stephen Witt, the only other reporter to cover the meeting and tour April 11 in preparation for a State Senate oversight hearing regarding Atlantic Yards, came up with a somewhat different story (right; click to enlarge) than mine.

The article published this weekend did quote State Senator Velmanette Montgomery as saying that the hearing, conducted by State Senator Bill Perkins, "will look at how public authorities are constituted and how more government oversite [sic] can be instituted over their operations."

But the article did emphasize, in the lead, that Montgomery said that the hearing would include testimony from both supporters and opponents of the project.

And it closed with a quote from James Caldwell of Brooklyn United for Innovative Local Development (BUILD), a Community Benefits Agreement (CBA) signatory: "This project needs to start already, because people need to go to work."

What's the point?

But the hearing is about oversight of the Empire State Development Corporation (ESDC) and other agencies, so it shouldn't be a do-over from the environmental review process in which supporters and opponents state their views.

Bogus blight

The hearing should address issues like blight, given that a state judge called "ludicrous" the ESDC's contention that it could only look at conditions contemporaneous with the study, which was conducted years after the project's announcement.

The state defines blight so loosely that it was applied to minor cracks (right) in the sidewalk within the AY footprint. (Here's Develop Don't Destroy Brooklyn's response to the Blight Study)

And, as veteran planner (and now Develop Don't Destroy Brooklyn board member) Ron Shiffman pointed out some two years ago, the ESDC's claim that lots that are built to 60 percent or less of their allowable Floor Area Ratio (FAR) under current zoning are blighted should be looked at with skepticism: "Under this standard, large sections of Brooklyn would be considered blighted, as they are also not built out to their full capacity under existing zoning."

The state's Blight Study used highly dubious crime statistics, an analysis so unconvincing that a judge evaluating the challenge to the environmental review simply ignored the crime issue.

There are some public policy issues here:
  • should the definition of blight be tightened?
  • should blight be evaluated at the time a project is announced or later, after the impact of the announcement sets in?
  • are there an enormous number of places actually blighted in New York?
  • was the ESDC's use of crime statistics remotely convincing?
  • is the fabric of the community "shot to hell"? (that's academic Lynne Sagalyn's characterization of blight)
The missing cost/benefit analysis

The ESDC's fiscal impact analysis addressed costs, not benefits. (The Independent Budget Office was the only entity to do a partial cost-benefit analysis, but it related only to the arena, not the project as a whole, and now the IBO thinks it's time for at least a partial look.)

Despite what the ESDC said in court papers regarding the pending state eminent domain case, the state made no attempt to quantify the benefits due to Forest City Ratner.

The KPMG study at issue tried to assess the financial viability of the project rather than assess profits (which had to include things like development fees) or balance private and public benefits.

In court in February, a lawyer for the ESDC acknowledged that the state made no such finding of relative benefit.

No such finding was required, the lawyer said, given the goals at issue. One justification: the site was “afflicted for decades with substantial blight.”

But what if it wasn't?

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